Questions & Answers

What is the basis of my second home or vacation home?

The basis of your home is usually the price you paid to purchase it. However, home additions and permanent home improvements will increase the basis of your home. Generally, the basis in your home subtracted from your sales price will determine the gain on the sale of your home. So, a higher basis will result in a smaller gain and potentially less taxes. For more information, see Home Additions and Permanent Home Improvements.

If your home was ever used for business or rental purposes, only enter the personal portion as an investment sale. See Business or Rental Property for more information on where to enter the business portion.

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